Exhibit
10.12


 


INDEMNIFICATION
AGREEMENT


 


THIS INDEMNIFICATION
AGREEMENT (this “Agreement”) is
made as of
[                      ],
2009, by and between Ironwood Pharmaceuticals, Inc., a Delaware
corporation (the “Company”) and
[              ]
(“Indemnitee”).


 


RECITALS


 


WHEREAS, although the
Certificate of Incorporation and the Bylaws of the Company provide for
indemnification of the officers and directors of the Company and Indemnitee may
also be entitled to indemnification pursuant to the General Corporation Law of
the State of Delaware (“DGCL”),
the DGCL expressly contemplates that contracts may be entered into between the
Company and its directors and officers with respect to indemnification of such
directors and officers;


 


WHEREAS, Indemnitee’s
continued service to the Company substantially benefits the Company;


 


WHEREAS, the Board of
Directors of the Company (the “Board”)
has determined that it is in the best interest of the Company and that it is
reasonably prudent and necessary for the Company to contractually obligate
itself to indemnify, and to advance expenses on behalf of, Indemnitee to the
fullest extent permitted by applicable law in order to induce Indemnitee to
serve or continue to serve the Company free from undue concern that Indemnitee
will not be so indemnified or that any indemnification obligation will not be
met;


 


WHEREAS, this Agreement
is a supplement to and in furtherance of (a) the Certificate of
Incorporation and Bylaws of the Company and (b) the certificate of
incorporation, bylaws, partnership agreement or other organizational document,
as the case may be, of any Enterprise (as defined below), and any resolutions
adopted pursuant thereto, and shall not be deemed a substitute therefor, nor to
diminish or abrogate any rights of Indemnitee thereunder; and


 


WHEREAS, Indemnitee does
not regard the protection available under the Company’s Certificate of
Incorporation, Bylaws and insurance or any other Enterprise’s certificate of
incorporation, bylaws, partnership agreement or other organizational document,
as the case may be, and insurance, as adequate in the present circumstances,
and may not be willing to serve as a director or officer without adequate
protection, and the Company desires Indemnitee to serve in such capacity.  Indemnitee is willing to serve, continue to
serve and to take on additional service for or on behalf of the Company and
certain other Enterprises on the condition that Indemnitee be so indemnified.


 


NOW, THEREFORE, in
consideration of the promises and the covenants contained herein, the Company
and Indemnitee do hereby covenant and agree as follows:


 


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AGREEMENT


 


1.             Services to the Company and Certain Other
Enterprises.  Indemnitee will serve or continue to serve as
a director and/or officer of the Company or other Enterprises for so long as
Indemnitee is duly elected or appointed or until Indemnitee tenders a
resignation.


 


2.             Definitions. 
As used in this Agreement:


 


(a)           “Change
of Control” means


 


(1)           any “person” (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act), becomes the
“Beneficial Owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing more than
fifty percent (50%) of the total voting power represented by the Company’s then
outstanding voting securities (excluding for this purpose any such voting
securities held by the Company, or any affiliate, parent or subsidiary of the
Company or any employee benefit plan of the Company) pursuant to a transaction
or a series of transactions which the Board does not approve;


 


(2)           a merger or consolidation of the
Company, whether or not approved by the Board, which results in the holders of
voting securities of the Company outstanding immediately prior thereto failing
to continue to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty percent (50%) of
the combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation;


 


(3)           the sale or disposition of all or
substantially all of the Company’s assets (or consummation of any transaction
having similar effect) provided that the sale or disposition is of more than
two-thirds (2/3) of the assets of the Company; or


 


(4)           the date a majority of members of
the Board is replaced during any twelve (12) month period by directors whose
appointment or election is not endorsed by a majority of the members of the
Board before the date of the appointment or election.


 


(5)           In any case, a Change of Control under this Section 2(a) must
also meet the requirements of a change in ownership or effective control, or a
sale of a substantial portion of the Company’s assets in accordance with
Section 409A(a)(2)(A)(v) of the Internal Revenue Code of 1986, as
amended, and the applicable provisions of Treasury Regulation § 1.409A-3.


 


(b)           “Corporate
Status” describes the status of a person who is or was a director,
officer, employee, agent or fiduciary of the Company or of any other
Enterprise.


 


(c)           “Disinterested
Director” means a director of the Company who is not and was not a
party to the Proceeding in respect of which indemnification is sought by
Indemnitee.


 


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(d)           “Enterprise”
means (i) the Company, (ii) any other corporation, partnership,
limited liability company, joint venture, trust, employee benefit plan or other
enterprise which is an affiliate or wholly or partially owned subsidiary of the
Company and of which Indemnitee is or was serving as a director, trustee,
general partner, managing member, officer, employee, agent or fiduciary and
(iii) any other corporation, partnership, limited liability company, joint
venture, trust, employee benefit plan or other enterprise of which Indemnitee
is or was serving at the request of the Company.


 


(e)           “Exchange
Act” means the Securities Exchange Act of 1934, as amended.


 


(f)            “Expenses”
includes all reasonable attorneys’ fees, retainers, court costs, transcript
costs, fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery service fees,
and all other disbursements or expenses of the types customarily incurred in
connection with prosecuting, defending, preparing to prosecute or defend,
investigating, being or preparing to be a witness in, or otherwise
participating in, a Proceeding.  Expenses
shall include such fees and expenses, and costs incurred in connection with any
appeal resulting from any Proceeding, including without limitation the premium,
security for, and other costs relating to any cost bond, supersedeas bond, or
other appeal bond or its equivalent. 
Expenses, however, shall not include amounts paid in settlement by
Indemnitee or the amount of judgments or fines against Indemnitee.


 


(g)           “Independent
Counsel” means, at any time, any law firm, or a member of a law
firm, that (i) is experienced in matters of corporation law and
(ii) is not, at such time, or has not been in the five years prior to such
time, retained to represent: (1) the Company or Indemnitee in any matter
material to either such party (other than with respect to matters concerning
Indemnitee under this Agreement, or of other indemnities under similar
indemnification agreements), or (2) any other party to the Proceeding
giving rise to a claim for indemnification hereunder.  Notwithstanding the foregoing, the term
“Independent Counsel” shall not include any person who, under the applicable
standards of professional conduct then prevailing, would have a conflict of
interest in representing either the Company or Indemnitee in an action to
determine Indemnitee’s rights under this Agreement.  The Company agrees to pay the reasonable fees
and expenses of the Independent Counsel referred to above and to fully
indemnify such counsel against any and all Expenses, claims, liabilities and
damages arising out of or relating to this Agreement or its engagement pursuant
hereto and to be jointly and severally liable therefor.


 


(h)           “Proceeding”
includes any threatened, pending or completed action, suit, arbitration,
mediation, alternate dispute resolution mechanism, investigation, inquiry,
administrative hearing or any other actual, threatened or completed proceeding,
whether brought by or in the right of the Company or otherwise and whether of a
civil, criminal, administrative or investigative nature, including without
limitation any such proceeding pending as of the date of this Agreement, in
which Indemnitee was, is or will be involved as a party or otherwise by reason
of the fact that Indemnitee is or was an officer or director of the Company, by
reason of any action taken by Indemnitee or of any action on Indemnitee’s part
while acting as director or officer of the Company, or by reason of the fact
that Indemnitee is or was serving as a director, trustee, general partner,
managing member, officer, employee, agent or fiduciary of any other 


 


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Enterprise, in each case
whether or not serving in such capacity at the time any Expense, judgment, fine
or amount paid in settlement is incurred for which indemnification,
reimbursement, or advancement of Expenses can be provided under this Agreement.


 


3.             Indemnity in Third-Party Proceedings.  The Company shall be liable to
indemnify Indemnitee in accordance with the provisions of this Section 3
if Indemnitee is, or is threatened to be made, a party to or a participant (as
a witness or otherwise) in any Proceeding, other than a Proceeding by or in the
right of the Company to procure a judgment in its favor.  Pursuant to this Section 3, Indemnitee
shall be indemnified against all Expenses, judgments, fines and amounts paid in
settlement actually and reasonably incurred by Indemnitee or on Indemnitee’s
behalf in connection with such Proceeding or any claim, issue or matter
therein, if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company and, in the case of a criminal Proceeding, had no reasonable cause to
believe that Indemnitee’s conduct was unlawful.


 


4.             Indemnity in Proceedings by or in the
Right of the Company.  The Company shall be liable to indemnify
Indemnitee in accordance with the provisions of this Section 4 if
Indemnitee is, or is threatened to be made, a party to or a participant (as a
witness or otherwise) in any Proceeding by or in the right of the Company to
procure a judgment in its favor. 
Pursuant to this Section 4, Indemnitee shall be indemnified against
all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s
behalf in connection with such Proceeding (or any claim, issue or matter
therein) if Indemnitee acted in good faith and in a manner Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company; provided,
however that no indemnification for Expenses shall be made under this
Section 4 in respect of any claim, issue or matter as to which Indemnitee
shall have been finally adjudged by a court of competent jurisdiction to be
liable to the Company, unless and only to the extent that any court in which
the Proceeding was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case,
Indemnitee is fairly and reasonably entitled to indemnification.


 


5.             Indemnification for Expenses of a Party
Who is Wholly or Partly Successful. 
Notwithstanding any other provisions of this Agreement, to the extent
that Indemnitee is a party to (or a participant in) and is successful, on the
merits or otherwise, in any Proceeding, the Company shall be liable to
indemnify Indemnitee against all Expenses actually and reasonably incurred by
him in connection therewith.  If Indemnitee
is not wholly successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in
such Proceeding, the Company shall be liable to indemnify Indemnitee against
all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s
behalf in connection with each successfully resolved claim, issue or
matter.  For purposes of this
Section and without limitation, the termination of any claim, issue or
matter in such a Proceeding by dismissal, with or without prejudice, shall be
deemed to be a successful result as to such claim, issue or matter.


 


6.             Indemnification For Expenses of a Witness. 
Notwithstanding any other provision of this Agreement, to the extent
that Indemnitee is, by reason of Indemnitee’s Corporate Status, a witness in
any Proceeding to which Indemnitee is not a party, the Company shall be liable
to 


 


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indemnify Indemnitee
against all Expenses actually and reasonably incurred by Indemnitee or on
Indemnitee’s behalf in connection therewith.


 


7.             Additional Indemnification


 


(a)           Notwithstanding any limitation in
Sections 3, 4, or 5, the Company shall be liable to indemnify Indemnitee to the
fullest extent permitted by law if Indemnitee is a party to, or threatened to
be made a party to, any Proceeding (including a Proceeding by or in the right
of the Company to procure a judgment in its favor) against all Expenses,
judgments, fines and amounts paid in settlement actually and reasonably
incurred by Indemnitee in connection with the Proceeding; provided, however,
that no indemnity shall be made under this Section 7(a) on account of
Indemnitee’s conduct which has been adjudicated to constitute a breach of
Indemnitee’s duty of loyalty to the Company or its shareholders or to
constitute an act or omission not in good faith or involving intentional
misconduct or a knowing violation of the law.


 


(b)           For purposes of Section 7(a), the
meaning of the phrase “to the fullest extent permitted by law” shall include,
but not be limited to:


 


(1)           to the  fullest extent permitted by the provision of
the DGCL that authorizes or contemplates additional indemnification by
agreement, or the corresponding provision of any amendment to or replacement of
the DGCL; and


 


(2)           to the fullest extent authorized
or permitted by any amendments to or replacements of the DGCL adopted after the
date of this Agreement that increase the extent to which a corporation may
indemnify its officers and directors.


 


8.             Exclusions. 
Notwithstanding any provision in this Agreement, the Company shall not
be obligated under this Agreement to make any indemnity payment in connection
with any claim made against Indemnitee:


 


(a)           for which payment has actually been
received by or on behalf of Indemnitee under any insurance policy or other
indemnity provision, except with respect to any excess beyond the amount
actually received under any insurance policy or other indemnity provision;


 


(b)           for an accounting of profits made from the
purchase and sale (or sale and purchase) by Indemnitee of securities of the
Company within the meaning of Section 16(b) of the Exchange Act or
similar provisions of state statutory law or common law; provided, however,
that notwithstanding any limitation on the Company’s obligation to provide
indemnification set forth in this Section 8(b) or elsewhere,
Indemnitee shall be entitled to receive advancement of Expenses hereunder with
respect to any such claim unless and until a court having jurisdiction over the
claim shall have made a final judicial determination (as to which all rights of
appeal therefrom have been exhausted or lapsed) that Indemnitee has violated
said statute; or


 


(c)           in connection with any Proceeding (or any
part of any Proceeding) initiated by Indemnitee, including any Proceeding (or
any part of any Proceeding) initiated by Indemnitee against the Company or its
directors, officers, employees or other indemnitees, 


 


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unless (i) such
indemnification is expressly required to be made by applicable law,
(ii) the Proceeding was authorized by the Board, (iii) such
indemnification is provided by the Company, in its sole discretion, pursuant to
the powers vested in the Company under the DGCL, or (iv) such
indemnification is required to be made pursuant to Section 13.


 


9.             Advancement of Expenses; Defense of Claim.


 


(a)           Notwithstanding any provision of this
Agreement to the contrary, the Company shall be obligated to advance any and
all Expenses incurred by Indemnitee in connection with any Proceeding within
thirty (30) days after the receipt by the Company of a statement or statements
requesting such advances from time to time, whether prior to or after final
disposition of any Proceeding.  Such
statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by a written
undertaking by or on behalf of Indemnitee to repay any Expenses advanced to the
extent and only to the extent that it is ultimately determined that Indemnitee
is not entitled to be indemnified by the Company.  Any advances (i) shall be unsecured and
interest free;  (ii) shall be made
without regard to Indemnitee’s ability to repay the advances and without regard
to Indemnitee’s ultimate entitlement to indemnification under the other
provisions of this Agreement; and (iii) shall include any and all
reasonable Expenses incurred pursuing an action to enforce this right of
advancement, including Expenses incurred preparing and forwarding statements to
the Company to support the advances claimed. 
The Company will be entitled to participate reasonably in the Proceeding
at its own expense.


 


10.           Procedure for Notification and Requests
for Advancement and Indemnification.


 


(a)           Notification. 
To obtain advancement of Expenses and/or indemnification under this
Agreement, Indemnitee shall, not later than sixty (60) days after receipt by
Indemnitee of notice of the commencement of any Proceeding, except for
Proceedings pending as of the date of this Agreement, submit to the Company
written notification of the Proceeding; with regard to Proceedings pending as
of the date of this Agreement, Indemnitee shall submit to the Company written
notification not later than thirty (30) days after the date of this
Agreement.  The omission to notify the
Company will relieve the Company of its advancement or indemnification
obligations under this Agreement only to the extent the Company can establish
that such omission to notify resulted in actual prejudice to it, and the
omission to notify the Company will, in any event, not relieve the Company from
any liability which it may have to indemnify Indemnitee otherwise than under
this Agreement.  The Secretary of the
Company shall, promptly upon receipt of notification from Indemnitee pursuant
to this Section 10(a), advise the Board in writing that Indemnitee has
provided such notification.


 


(b)           Expense Request. 
Subject to Section 9, to obtain advancement of Expenses under this
Agreement, Indemnitee shall submit to the Company a written request therefor,
together with such invoices or other supporting information as may be
reasonably requested by the Company and reasonably available to Indemnitee,
and, only to the extent required by applicable law which cannot be waived, an
unsecured written undertaking to repay amounts advanced.  The Company shall make advance payment of
Expenses to Indemnitee no later than thirty (30) days after receipt of the
written request for advancement (and each 


 


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subsequent request for
advancement) by Indemnitee.  If, at the
time of receipt of any such written request for advancement of Expenses, the
Company has director and officer insurance policies in effect, the Company will
promptly notify the relevant insurers in accordance with the procedures and
requirements of such policies.  The
Company shall thereafter keep such director and officer insurers informed of
the status of the Proceeding or other claim, as appropriate to secure coverage
of Indemnitee for such claim.


 


(c)           Indemnification Request. 
In order to obtain indemnification under this Agreement, Indemnitee
shall, anytime at Indemnitee’s discretion following notification by Indemnitee
of the commencement of any Proceeding pursuant to Section 10(a) of
this Agreement and consistent with the time period for the duration of this
Agreement as set forth in Section 15 of this Agreement, submit to the
Company a written request for indemnification pursuant to this Section 10(c),
including therein or therewith such documentation and information as is
reasonably available to Indemnitee and is reasonably necessary to determine
whether and to what extent Indemnitee is entitled to indemnification.  No determination of Indemnitee’s entitlement
to indemnification shall be made until such written request for a determination
is submitted by Indemnitee to the Company pursuant to this
Section 10(c).  The failure to
submit a written request to the Company will relieve the Company of its
indemnification obligations under this Agreement only to the extent the Company
can establish that such failure to make a written request resulted in actual
prejudice to it, and the failure to make a written request will not relieve the
Company from any liability which it may have to indemnify Indemnitee otherwise
than under this Agreement.  The Secretary
of the Company shall, promptly upon receipt of such a request for
indemnification, advise the Board in writing that Indemnitee has requested
indemnification.  Upon submission of a
written request for indemnification by Indemnitee pursuant to this
Section 10(c), Indemnitee’s entitlement to indemnification shall be
determined according to Section 11 of this Agreement.


 


11.           Procedure Upon Application for
Indemnification.


 


(a)           Upon receipt of Indemnitee’s written
request for indemnification pursuant to Section 10(c), a determination
with respect thereto shall be made in the specific case by one of the following
three methods, which shall be at the election of the Board:  (i) by a majority vote of the
Disinterested Directors, even though less than a quorum, (ii) by a
committee of Disinterested Directors designated by a majority vote of the
Disinterested Directors, even though less than a quorum, or (iii) if there
are no Disinterested Directors or if the Disinterested Directors so direct, by
Independent Counsel in a written opinion to the Board, a copy of which shall be
delivered to Indemnitee.  Notwithstanding
the above, if a determination with respect to Indemnitee’s right to
indemnification is to be made following a Change of Control, such determination
shall be made in the specific case by Independent Counsel in a written opinion
to the Board, a copy of which shall be delivered to Indemnitee.  If it is so determined that Indemnitee is
entitled to indemnification, payment to Indemnitee shall be made within ten
(10) days after such determination. 
Indemnitee shall reasonably cooperate with the person, persons or entity
making such determination with respect to Indemnitee’s entitlement to
indemnification, including providing to such person, persons or entity upon
reasonable advance request any documentation or information which is not
privileged or otherwise protected from disclosure and which is reasonably
available to Indemnitee and reasonably necessary to such determination.  Any costs 


 


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or expenses (including
attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating
with the Disinterested Directors or Independent Counsel, as the case may be,
making such determination shall be advanced and borne by the Company
(irrespective of the determination as to Indemnitee’s entitlement to
indemnification) and the Company is liable to indemnify and hold Indemnitee
harmless therefrom.


 


(b)           In the event the determination of
entitlement to indemnification is to be made by Independent Counsel pursuant to
Section 11(a) hereof, the Independent Counsel shall be selected as
provided in this Section 11(b).  The
Independent Counsel shall be selected by the Board and the Board shall provide
written notice to the Indemnitee of the identity of the Independent Counsel so
selected.  Indemnitee may, within ten
(10) days after such written notice of selection shall have been received,
deliver to the Company a written objection to such selection; provided, however,
that such objection may be asserted only on the ground that the Independent
Counsel so selected does not meet the requirements of “Independent Counsel” as
defined in Section 2 of this Agreement, and the objection shall set forth
with particularity the factual basis of such assertion.  Absent a proper and timely objection, the
person so selected shall act as Independent Counsel.  If a written objection is so made and
substantiated, the Independent Counsel so selected may not serve as Independent
Counsel unless and until such objection is withdrawn or a court of competent
jurisdiction has determined that such objection is without merit.  If, within twenty (20) days after submission
by Indemnitee of a written request for indemnification pursuant to
Section 10(c) hereof, no Independent Counsel shall have been selected
and not objected to, either the Company or Indemnitee may petition a court of
competent jurisdiction for resolution of any objection which shall have been
made by the Indemnitee to the Company’s selection of Independent Counsel and/or
for the appointment as Independent Counsel of a person selected by the Court or
by such other person as the Court shall designate, and the person with respect
to whom all objections are so resolved or the person so appointed shall act as
Independent Counsel under Section 11(a) hereof.  Upon the due commencement of any judicial
proceeding or arbitration pursuant to Section 13(a) of this Agreement,
Independent Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable standards of
professional conduct then prevailing). 
The Company shall pay all reasonable fees and expenses incident to the
procedures of this Section 11(b), regardless of the manner in which such
Independent Counsel was selected or appointed.


 


12.           Presumptions and Effect of Certain
Proceedings.


 


(a)           In making a determination with respect to
entitlement to indemnification hereunder, the person or persons or entity
making such determination shall presume that Indemnitee is entitled to
indemnification under this Agreement if Indemnitee has submitted a notice and a
request for indemnification in accordance with Section 10 of this Agreement.  Anyone seeking to overcome this presumption
shall have the burden or proof and the burden of persuasion by clear and
convincing evidence.  Neither the failure
of the Company (including by the Board) or of Independent Counsel to have made
a determination prior to the commencement of any judicial proceeding or
arbitration pursuant to this Agreement that indemnification is proper in the
circumstances because Indemnitee has met the applicable standard of conduct,
nor an actual determination by the Company (including by the Board) or by
Independent Counsel


 


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that Indemnitee has not met such applicable
standard of conduct, shall be a defense to the action or create a presumption
that Indemnitee has not met the applicable standard of conduct.


 


(b)           If the person, persons or entity
empowered or selected under Section 11 of this Agreement to determine
whether Indemnitee is entitled to indemnification shall not have made a
determination within sixty (60) days after receipt by the Company of
Indemnitee’s written request for indemnification pursuant to Section 10(c) of
this Agreement, the requisite determination of entitlement to indemnification
shall be deemed to have been made and Indemnitee shall be entitled to such
indemnification, absent (i) a misstatement by Indemnitee of a material
fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for
indemnification, or (ii) a prohibition of such indemnification under
applicable law; provided, however, that such 60-day period may be
extended for a reasonable time, not to exceed an additional thirty (30) days,
if the person, persons or entity making the determination with respect to
entitlement to indemnification in good faith requires such additional time for
the obtaining or evaluating of documentation and/or information relating
thereto.


 


(c)           The termination of any Proceeding
or of any claim, issue or matter therein, by judgment, order, settlement or
conviction, or upon a plea of nolo
contendere or its equivalent, shall not (except as otherwise
expressly provided in this Agreement) of itself adversely affect the right of
Indemnitee to indemnification or create a presumption that Indemnitee did not
act in good faith and in a manner which Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company or, with respect to any
criminal Proceeding, that Indemnitee had reasonable cause to believe that
Indemnitee’s conduct was unlawful.


 


(d)           Reliance as Safe
Harbor.  For purposes of any
determination of good faith, Indemnitee shall be deemed to have acted in good
faith if Indemnitee’s action or failure to act is based on the records or books
of account of the Enterprise, including financial statements, or on information
supplied to Indemnitee by the officers of the Enterprise in the course of their
duties, or on the advice of legal counsel for the Enterprise or on information
or records given or reports made to the Enterprise by an independent certified
public accountant or by an appraiser or other expert selected by the Enterprise.  The provisions of this Section 12(d) shall
not be deemed to be exclusive or to limit in any way the other circumstances in
which Indemnitee may be deemed or found to have met the applicable standard of
conduct set forth in this Agreement.


 


(e)           Actions of Others.  The knowledge and/or actions, or failure to
act, of any other director, partner, managing member, officer, agent, employee
or trustee of the Enterprise shall not be imputed to Indemnitee for purposes of
determining Indemnitee’s right to indemnification under this Agreement.


 


13.           Remedies of Indemnitee.


 


(a)           In the event that (i) a
determination is made pursuant to Section 11 of this Agreement that
Indemnitee is not entitled to indemnification under this Agreement,
(ii) advancement of Expenses is not timely made pursuant to Section 9
or 10(b) of this Agreement, (iii) payment of indemnification is not
made pursuant to Section 5, 6, 7 or the last 


 


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sentence of Section 11(a) of this
Agreement within ten (10) days after receipt by the Company of a written
request therefor, or (iv) payment of indemnification pursuant to
Section 3 or 4 of this Agreement is not made within ten (10) days
after a determination has been made that Indemnitee is entitled to
indemnification, or (v) Indemnitee determines in its sole discretion that
such action is appropriate or desirable, Indemnitee shall be entitled to seek
an adjudication by a court of competent jurisdiction as to Indemnitee’s
entitlement to such indemnification or advancement of Expenses.  Alternatively, Indemnitee, at Indemnitee’s
option, may seek an award in arbitration to be conducted by a single arbitrator
pursuant to the Commercial Arbitration Rules of the American Arbitration
Association.  The Company shall not
oppose Indemnitee’s right to seek any such adjudication or award in
arbitration.


 


(b)           In the event that a determination
shall have been made pursuant to Section 11(a) of this Agreement that
Indemnitee is not entitled to indemnification, any judicial proceeding or
arbitration, commenced pursuant to this Section 13, shall be conducted in
all respects as a de novo trial, or arbitration, on the merits, and Indemnitee
shall not be prejudiced by reason of that adverse determination.  In any judicial proceeding or arbitration
commenced pursuant to this Section 13, in the event that the person,
persons or entity empowered or selected under Section 11 of this Agreement
to determine whether Indemnitee is entitled to indemnification has not made
such a determination within the time period provided for under
Section 12(b) of this Agreement, the Company shall stipulate and may
not contest that Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or Proceeding, had no
reasonable cause to believe Indemnitee’s conduct was unlawful.


 


(c)           If a determination shall have
been made pursuant to Section 11(a) of this Agreement that Indemnitee
is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to
this Section 13, absent (i) a misstatement by Indemnitee of a
material fact, or an omission of a material fact necessary to make Indemnitee’s
statement not materially misleading, in connection with the request for
indemnification, or (ii) a prohibition of such indemnification under
applicable law.


 


(d)           In the event that Indemnitee is a
party to a judicial proceeding or arbitration pursuant to this Section 13
concerning Indemnitee’s rights under, or to recover damages for breach of, this
Agreement, Indemnitee shall be entitled to recover from the Company, and shall
be indemnified by the Company against, any and all Expenses actually and
reasonably incurred by him in such judicial adjudication or arbitration.  If it shall be determined in said judicial
adjudication or arbitration that Indemnitee is entitled to receive part but not
all of the indemnification or advancement of Expenses sought, Indemnitee shall
be entitled to recover from the Company (who shall be liable therefor), and
shall be indemnified by the Company against, any and all Expenses reasonably
incurred by Indemnitee in connection with such judicial adjudication or
arbitration.


 


(e)           The Company shall be precluded
from asserting in any judicial proceeding or arbitration commenced pursuant to
this Section 13 that the procedures and presumptions of this Agreement are
not valid, binding and enforceable and shall stipulate in any such court or
before any such arbitrator that the Company is bound by all the provisions of
this Agreement.  


 


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The Company shall be liable to indemnify
Indemnitee against any and all Expenses and, if requested by Indemnitee, shall
(within ten (10) days after receipt by the Company of a written request
therefore) advance such Expenses to Indemnitee that are incurred by Indemnitee
in connection with any judicial adjudication or arbitration involving
Indemnitee for indemnification or advancement of Expenses from the Company
under this Agreement or under any directors’ and officers’ liability insurance
policies maintained by the Company, regardless of whether Indemnitee ultimately
is determined to be entitled to such indemnification, advancement of Expenses
or insurance recovery, as the case may be.


 


14.           Non-Exclusivity; Survival of Rights;
Insurance.


 


(a)           The rights of indemnification and
to receive advancement of Expenses as provided by this Agreement shall not be
deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable law, the Company’s or any other Enterprise’s
Certificate of Incorporation, Bylaws or similar organizational documents, any
agreement, a vote of stockholders or a resolution of directors, or
otherwise.  No amendment, alteration or
repeal of this Agreement or of any provision hereof shall limit or restrict any
right of Indemnitee under this Agreement in respect to any action taken or omitted
by such Indemnitee in Indemnitee’s Corporate Status prior to such amendment,
alteration or repeal.  To the extent that
a change in Delaware law, whether by statute or judicial decision, permits
greater indemnification or advancement of Expenses than would be afforded
currently under the Company’s or any other Enterprise’s Certificate of
Incorporation, Bylaws and this Agreement, it is the intent of the parties
hereto that Indemnitee shall enjoy by this Agreement the greater benefits so
afforded by such change.  No right or
remedy herein conferred is intended to be exclusive of any other right or
remedy, and every other right and remedy shall be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise.  The assertion
or employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other right or remedy.


 


(b)           To the extent that the Company
maintains an insurance policy or policies providing liability insurance for
directors, partners, managing members, officers, employees, agents or trustees
of the Company or of any other Enterprise, Indemnitee shall be covered by such
policy or policies in accordance with its or their terms to the maximum extent
of the coverage available for any such director, partner, managing member,
officer, employee, agent or trustee under such policy or policies.  If, at the time of the receipt of a notice of
a claim pursuant to Section 10(a) hereof, the Company has director
and officer liability insurance in effect, the Company shall give prompt notice
of the commencement of such Proceeding to the insurers in accordance with the
procedures set forth in the respective policies.  The Company shall thereafter take all
necessary or desirable action to cause such insurers to pay, on behalf of
Indemnitee, all amounts payable as a result of such Proceeding in accordance
with the terms of such policies.


 


(c)           The Company shall not be liable
under this Agreement to make any payment of amounts otherwise indemnifiable (or
for which advancement is provided hereunder) hereunder if and only to the
extent that Indemnitee has otherwise actually received such payment under any
insurance policy, contract, agreement or otherwise.


 


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(d)           The Company’s obligation
hereunder to indemnify, or advance Expenses to, Indemnitee who was, is or will
be serving as a director, partner, managing member, officer, employee, agent or
trustee of any other Enterprise shall be reduced by any amount Indemnitee has
actually received as indemnification or advancement of Expenses from such other
Enterprise.


 


15.           Duration of Agreement.  This
Agreement shall continue until and terminate upon the later of: (a) ten
(10) years after the date that Indemnitee shall have ceased to serve as a
director of the Company or as a director, partner, managing member, officer,
employee, agent or trustee of any other Enterprise; or (b) one (1) year
after the final termination (i) of any Proceeding (including any rights of
appeal) then pending in respect of which Indemnitee requests indemnification or
advancement of Expenses hereunder and (ii) of any judicial proceeding or
arbitration pursuant to Section 13 of this Agreement (including any rights
of appeal) involving Indemnitee.  This
Agreement shall be binding upon the Company and its successors and assigns and
shall inure to the benefit of Indemnitee and Indemnitee’s heirs, executors and
administrators.


 


16.           Severability.  If
any provision or provisions of this Agreement shall be held to be invalid,
illegal or unenforceable for any reason whatsoever: (a) the validity,
legality and enforceability of the remaining provisions of this Agreement
(including, without limitation, each portion of any Section of this
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that is not itself invalid, illegal or unenforceable) shall not
in any way be affected or impaired thereby and shall remain enforceable to the
fullest extent permitted by law; (b) such provision or provisions shall be
deemed reformed to the extent necessary to conform to applicable law and to
give the maximum effect to the intent of the parties hereto; and (c) to
the fullest extent possible, the provisions of this Agreement (including,
without limitation, each portion of any section of this Agreement containing
any such provision held to be invalid, illegal or unenforceable, that is not
itself invalid, illegal or unenforceable) shall be construed so as to give
effect to the intent manifested thereby.


 


17.           Enforcement.


 


(a)           The Company expressly confirms
and agrees that it has entered into this Agreement and assumed the obligations
imposed on it hereby in order to induce Indemnitee to continue to serve as a
director or officer of the Company, and the Company acknowledges that
Indemnitee is relying upon this Agreement in serving as a director or officer
of the Company.


 


(b)           This Agreement constitutes the
entire agreement between the parties hereto with respect to the subject hereof
and supersedes any and all prior agreements and understandings, oral, written
and implied, between the parties hereto with respect to the subject matter
hereof.


 


18.           Modification and Waiver.  No
supplement, modification or amendment of this Agreement shall be binding unless
executed in writing by the parties hereto. 
No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a wavier of any other provisions of this Agreement nor shall
any waiver constitute a continuing waiver.


 


19.           Notice by Indemnitee. 
Indemnitee agrees promptly to notify the Company in writing upon being
served with any summons, citation, subpoena, complaint, indictment, 


 


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information
or other document relating to any Proceeding or matter which may be subject to
indemnification or advancement of Expenses covered hereunder.  The failure of Indemnitee to so notify the
Company shall not relieve the Company of any obligation which it may have to
Indemnitee under this Agreement or otherwise.


 


20.           Notices.  All notices, requests, demands
and other communications under this Agreement shall be in writing and shall be
deemed to have been duly given (a) if delivered by hand and receipted for
by the party to whom said notice or other communication shall have been
directed, (b) when sent by confirmed electronic mail or facsimile if sent
during normal business hours of the recipient, and if not so confirmed, then on
the next business day, (c) if mailed by certified or registered mail with
postage prepaid, on the third business day after the date on which it is so
mailed, or (d) one (1) day after deposit with a nationally recognized
overnight courier, specifying next day delivery, with written verification:


 


(a)           If to Indemnitee, at the address
indicated on the signature page of this Agreement, or such other address
as Indemnitee shall provide in writing to the Company,


 


(b)           If to the Company to:                                          Ironwood
Pharmaceuticals, Inc.


320 Bent Street


Cambridge, MA 02141


Attention:


Fax:


E-Mail:


 


or
to any other address as may have been furnished to Indemnitee in writing by the
Company.


 


21.           Contribution.  To
the fullest extent permissible under applicable law, if the indemnification
provided for in this Agreement is unavailable to Indemnitee for any reason
whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute
to the amount incurred by Indemnitee, whether for judgments, fines, penalties,
excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in
connection with any claim relating to an indemnifiable event under this
Agreement, in such proportion in order to reflect (i) the relative
benefits received by the Company and Indemnitee as a result of the event(s) and/or
transaction(s) giving cause to such Proceeding; and/or (ii) the
relative fault of the Company (and its directors, officer, employees and
agents) and Indemnitee in connection with such event(s) and/or
transaction(s).


 


22.           Applicable Law and Consent to Jurisdiction.  This
Agreement and the legal relations among the parties shall be governed by, and
construed and enforced in accordance with, the laws of the State of Delaware,
without regard to its conflict of laws rules. 
Except with respect to any arbitration commenced by Indemnitee pursuant
to Section 13(a) of this Agreement, the Company and Indemnitee hereby
irrevocably and unconditionally (i) agree that any action or proceeding
arising out of or in connection with this Agreement shall be brought only in
the Chancery Court of the State of Delaware (the “Delaware Court”), and not in any other state or federal court
in the United States of America or any court in any other country
(ii) consent to submit to the exclusive jurisdiction of the Delaware Court
for purposes of any 


 


13

















 


action
or proceeding arising out of or in connection with this Agreement,
(iii) appoint, to the extent such party is not a resident of the State of
Delaware, irrevocably RL&F Service Corp., One Rodney Square, 10th Floor,
10th and King Streets, Wilmington, Delaware 19801 as its agent in the State of
Delaware as such party’s agent for acceptance of legal process in connection
with any such action or proceeding against such party with the same legal force
and validity as if served upon such party personally within the State of
Delaware, (iv) waive any objection to the laying of venue of any such
action or proceeding in the Delaware Court, and (v) waive, and agree not
to plead or to make, any claim that any such action or proceeding brought in
the Delaware Court has been brought in an improper or inconvenient forum.


 


23.           Counterparts.  This
Agreement may be executed in two or more counterparts, each of which shall for
all purposes be deemed to be an original, but all of which together shall
constitute one and the same Agreement. 
This Agreement may also be executed and delivered by facsimile signature
and in two or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.


 


24.           Headings.  The headings of the paragraphs
of this Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction thereof.


 


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page intentionally blank]


 


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IN
WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the
day and year first above written.


 


	
   

  	
  IRONWOOD PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  E-mail:

  	
   

  



 


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